Thursday, September 23, 2004

At the gourmet restaurant Anthony's, near the Galleria in Houston, a chief executive for one of the state's largest nursing home chains passed a $100,000 corporate check to state House Speaker candidate Tom Craddick just days before the 2002 election. Two years later, in the wake of 32 indictments in connection with corporate donations, both men say they didn't bother to count the zeros, much less look at the check.

Craddick downplays $100,000 exchange

Speaker says he had little to do with PAC at center of indictments

By Laylan Copelin, Austin American StatesmanThursday, September 23, 2004

At the gourmet restaurant Anthony's, near the Galleria in Houston, a chief executive for one of the state's largest nursing home chains passed a $100,000 corporate check to state House Speaker candidate Tom Craddick just days before the 2002 election.

Two years later, in the wake of 32 indictments in connection with corporate donations, both men say they didn't bother to count the zeros, much less look at the check.

The check, from a group of 14 of the nation's largest nursing home companies, was made out to Texans for a Republican Majority, the political action committee at the center of Tuesday's felony indictments.

At a public event Wednesday in his hometown of Midland, Craddick disputed the insinuation that he was collecting money for the PAC.

"I wasn't down there collecting anything," Craddick said. "I was just down there (in Houston) visiting with these people on their issues — election issues — and they gave it to me."

Since the grand jury investigation into political corruption began almost two years ago, Craddick has insisted that he had little to do with Texans for a Republican Majority, even as court documents show he talked frequently with the PAC's consultants, raised money for the group and had his staff distribute donations from the group to Republican candidates for the Texas House of Representatives.

On Tuesday, a Travis County grand jury indicted the Alliance for Quality Nursing Home Care Inc., the group of 14 nursing home companies, on a charge of making an unlawful political contribution by a corporation. John Colyandro, the PAC's executive director at the time of the election, was indicted because he accepted the $100,000 contribution.

Thirty-two indictments, naming eight companies and three individuals, all officials with Texans for a Republican Majority, were returned Tuesday.

State law prohibits raising and spending corporate money for campaign activity, but a political action committee can use corporate money to pay administrative expenses. At the center of the investigation is whether Texans for a Republican Majority illegally spent about $600,000 of corporate money on consultants, pollsters and phone banks. The group lawyers insist the money was spent on activities to assist the committee and not to promote the election or defeat of candidates. The group gave about $900,000 in noncorporate donations directly to candidates.

Craddick, who was not indicted Tuesday but remains under investigation, said Wednesday that he doesn't remember to whom he gave the $100,000 check: "It's a long time ago."

Bank records show Texans for a Republican Majority deposited the check two days after the meeting at Anthony's in Houston.

Hilley said his client was in Houston on business and was asked to deliver the check as a favor for other members of the alliance.

"He was just a messenger," Hilley said. "I don't think he even knew the size of the check."

The dinner at Anthony's, however, was not a coincidental meeting.

Austin lobbyist Neal "Buddy" Jones, a close ally of Craddick's who has represented nursing homes in Texas for years, confirmed Wednesday that he arranged the meeting. He refused to say anything else about his client's business, but added that he did not attend the meeting.

Among its activities, the Alliance for Quality Nursing Home Care runs TV commercials in Washington, D.C., and print ads in Roll Call, a publication for Capitol Hill, opposing cuts in Medicare aid for nursing home patients or appealing to Congress for more money to recruit and retain nurses.

But the night of Oct. 21, when Craddick and Winkle dined, the topic was limiting lawsuits against nursing homes.

Last year Steve Guillard, the Boston-based chairman of the alliance, said the group sent $100,000 to Texas less than three weeks before the election because its Texas members were interested in the pending legislative debate over limiting the legal liability of companies, including nursing homes.

Asked why the alliance felt it needed to give the money to Craddick if it was intended for the Texas PAC, Hilley said, "That's a good question."

It's not the first time Craddick or his staff handled PAC money.

Colyandro sent $152,000 in noncorporate donations, intended for Republican House candidates, to Craddick's Midland office. That money then was sent to the candidates. Those candidates, once elected, voted for Craddick for House speaker.

Craddick has said he had already secured enough pledges from House members to become speaker before the $152,000 was routed through his office.State law forbids outside groups from trying to influence a speaker's race in which only House members can vote. It also prohibits a candidate from accepting outside help.

On Wednesday, Craddick repeated that he had little to do with the PAC.

"I didn't run TRMPAC. I wasn't an officer of TRMPAC. And I didn't have a vote in TRMPAC," Craddick said.

But his interest — getting elected the first Republican speaker of the Texas House in more than a century — dovetailed with the PAC's goal of electing a Republican majority that would elect a GOP speaker.

In fact, Craddick talked to Kevin Brannon, a consultant for Texans for a Republican Majority who was evaluating the chances of Republican House candidates, 32 times during the final six weeks of the campaign, according to court documents. Craddick also raised donations for the group with his longtime friend Bill Ceverha, a former Dallas lawmaker who later helped Craddick set up the speaker's office.

Other court documents show contributors sent money to Texans for a Republican Majority at Craddick's behest.

Craddick said none of that was unusual.

"I had people ask me everywhere I went, 'How do we help you get control of the House?' " Craddick said.

But Craddick said he didn't know how the PAC was spending the corporate money — or even that the $100,000 check from the nursing home alliance was corporate money.